A trade deal is brewing between major southern California water agencies to help restock a major reservoir on the drought-stricken Colorado River and meet federal demands to cut back use.  

San Diego, Los Angeles and Imperial Valley are the major players trying something that’s never been done before using a water trading agreement inked 20 years ago as a guiding light. Under the proposal, San Diego is going to give up some of its Colorado River water it fought so hard to secure so more can be saved in the larger river system. But instead, it would lean on supplies from northern California, a source that was virtually unavailable to the region due to drought just last year. 

Here’s how it would play out: San Diego would forgo buying a portion of its Colorado River water supplies from Imperial Valley. The federal government would pay Imperial Valley not to take that water out of the river at all, then Imperial Valley would reimburse San Diego. Then San Diego would instead buy that same amount of water from California’s other (and cheaper) supply source – the Sierra Nevada mountain snowpack – via the Metropolitan Water District of Southern California.  

The board of the Metropolitan Water District of Southern California or Met, based in Los Angeles, will be the first to consider the deal at its Nov. 13 meeting. The savings San Diego generates from switching supplies – potentially tens of millions of dollars — could help smooth future water rates in San Diego, said the San Diego County Water Authority General Manager Dan Denham. 

“This is bringing more flexibility to water management in southern California,” Denham said. “If we’re able to pull this off then it speaks volumes for these water agencies and the federal government and show we’re able to work together.”  

This is part of a larger plan to help the Imperial Irrigation District or IID – the Colorado River’s single largest user and from which San Diego buys much of its Colorado River water – meet its promise to the feds to cut its use by 115,000 acre feet this year – about four percent of its supply. (That’s enough to quench 230,000 California households’ indoor and outdoor water use in one year.)  

The feds are paying IID to reduce its water use by that much. The price hasn’t been made public yet, but IID customers already pay some of the cheapest rates for Colorado River water around: about $20 an acre foot. San Diego buys its water from IID at a premium, about $710 an acre foot. It’s likely that the final reimbursement price from the feds will fall on the more expensive side of that range.  

What’s interesting about this deal is San Diego and Met have historically been at each other’s throats over prices of imported water. So much so that the two are still involved in a lawsuit over how much San Diego should pay Met to get Colorado River water down south. It’s partly why San Diego cut a deal 20 years ago to buy most of its water from Imperial Valley instead.  

But now, San Diego is turning back to Met for about 15 percent of its supply.  

“We’re taking advantage of the wet year and putting water in Lake Mead to benefit the whole (Colorado River) system,” said Adel Hagekhalil, general manager at Met. The State Water Project refers to water from the Sierra Nevada mountains.  

Even though it’s been a wet year, especially for California which drew most of the state out of drought, large swaths of the Colorado River basin are still dangerously dry, according to the U.S. Drought Monitor. The feds have told the seven U.S. states using the river they’ll need to figure out a way to use much less as climate change intensifies drought in the West. But last winter’s record-breaking rain and snow delivered a window for southern California water suppliers to spread that wealth of water around – for now. 

There’s so much water flowing from that mountain range’s melted snowpack, Met is able to use that source instead of the Colorado River for much of its customer day – about 19 million people. Because Met has two water sources, the Colorado River and the California mountains, it can lean on its California supply when water is plentiful and then, like a savings account, store water in the river’s largest reservoir (Lake Mead behind Hoover Dam) to use on a less-rainy day.  

Met has so much water it plans on maxing-out its savings account by banking 450,000 acre feet of water in Lake Mead, Hagekhalil said. And it will make a little extra money by selling more water to San Diego.  

“What you end up with is a win-win for everybody,” Hagekhalil said.  

The proposed deal would be temporary or in place just for 2023, according to a Met board document.